MARTIN Lewis’ MSE has issued an urgent car insurance warning to all divers as if you don’t act now, you could lost thousands of pounds.
The money saving experts shared tips on how to lock in a cheap quote that could save you a fortune.
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The money pros highlighted the shocking fact that the cost of car insurance is at its highest since records began over a decade ago – in 2012.
They also revealed that there are currently no signs of this reversing anytime soon, and urged all drivers to check immediately whether they can lock in a cheap quote – even if it’s not up for renewal.
“While insurers can no longer charge renewing customers more than newbies, that doesn’t mean you’ll get the best price by staying put,” they said on the website.
Since 1 January 2022, rules have banned car and home insurers from using a process known as “price-walking” or the “loyalty premium”.
This is where insurers would lure new customers in on cheap deals and then increase renewal prices each year, even if there had been no change in their circumstances, risk level or property.
“However, this DOESN’T mean your renewal quote is the best deal. Different insurers have different prices so you should still compare to see how much you could save from switching,” the experts said.
And using MSE’s Compare+ Car Insurance tool could help you find a cheaper deal and save hundreds of pounds in the process, they added.
The money saving experts explained that you could actually save a substantial amount by switching car insurer.
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“Our advice has always been to never just auto-renew – instead combine comparison sites to scour 100s of insurers in minutes,” they wrote.
If in doubt – MSE’s Compare+ Car Insurance tool allows you to just fill out one simple questionnaire and MSE will work out the rest for you.
The expert’s claim to provide cost-cutting tips as you write down your answers, and you’ll also be able to see insurance quotes as a benchmark.
You’ll also be able to use personalised tips to cut costs further and find out if other sites, such as Direct Line, may give cheaper quotes.
In the handy guide, the money expert’s covered what the main types of car insurance are, and what might work best for those who don’t want to break the bank.
The first type of cover is third party which is the minimal level of cover needed to drive legally, and only covers damage to someone else or their property.
The second is Third party, fire and theft which covers the same as general third party, but includes extras such as additional cover in case the car gets stolen or catches fire.
The last is comprehensive which covers the widest number of areas – you get third-party, fire and theft cover, plus if you have an accident and it was your fault you can claim the cost of repairing your car, as well as as any damage you cause to someone else or their property.
The website also offers cheap car insurance renewal tricks which can save you from forking out thousands.
The experts said that the best time to get car insurance quotes is 20 to 26 days before you need the policy to start as if you do nothing after receiving your renewal notice, it will often automatically renew at the new price.
They also advised drivers to check if they can save by adding a responsible driver to their policy.
“It may seem counter-logical, but covering an extra driver can reduce rather than increase your cost – in some cases by £100s or £1,000s,” they said.
“If you’re a high-risk driver and you add someone who is a much lower risk as a second (or third) driver, they can bring down the average risk and you may get a cheaper policy”.
They also highlighted that for the cheapest policies, you’ll usually need to pay annually.
“A monthly payment plan for your insurance is essentially a high-interest loan, and can vary from under 20%, to over 40% APR,” they explained.
“For example, if your premium is £1,000 and you want to pay monthly, you could pay £95/mth, which is £1,140/year (£140 more) at an average APR of 25%.
“So pay in full, or if you can’t afford it, use a credit card with a lower interest rate”.
This advice comes after Martin Lewis’ MSE revealed a little known 20p hack that could save drivers hundreds of pounds.
The MSE team also issued an urgent warning last month to anyone with an MOT due.
